Single Version Of The Truth: The Backbone Of Data-Driven Businesses

The single version of the truth isn’t dead; it’s just misunderstood. Most businesses mistakenly view the “single version of the truth” (SVOT) as a technology problem that can be only tackled by IT organizations. Often considered a futile effort, the concept is, in some cases, perceived as an abstract idea or, at best, wishful thinking.

Unfortunately, this line of thinking misses the point. The concept of SVOT represents the backbone of any data-driven enterprise. In fact, the desire to drive growth and profitability with business intelligence (BI) requires business leaders to exercise a strong commitment to SVOT. Otherwise, wrongly-made assumptions, mistakenly-subscribed prescriptions, and lack of leadership—not the fundamentals of SVOT—endure.

If understood, and applied correctly, the principals of SVOT bring consistency, clarity, focus, and precision to every enterprise data and analytics strategy.

What is the “single version of the truth”?

At its most basic level, the SVOT is a framework that enables the contextual review of consistent data points to answer business questions, where assumptions are well-defined and well-understood by the audience receiving the information. The variables in the SVOT formula cannot be altered behind the scenes and should remain unchanged until after the analysis is completed. Doing so ensures that the discussion is focused on action items, rather than create confusion and distraction by concentrating on the inconsistency of numbers.

When we hold discussions to answer a business question or address a business challenge, the outcome depends on precision. If any of the variables—such as source data, assumptions, and formulas—is out of sync, our results will inevitably vary. We are then left with figures that are inconsistent, unreliable, and fragmented.

Most businesses mistakenly view the “single version of the truth” as a technology problem that can be only tackled by IT organizations.

In the absence of SVOT, we spend more time talking about why there is a difference in the numbers, instead of focusing on how we can address the gap to achieve our goals. We waste scarce time, money, and other resources as we struggle to understand the critical issues and answer fundamental questions.

As a result, we argue about things that we should have already agree on and miss the opportunity to drive consensus on topics that compel a vital debate for a solution.

SVOT doesn’t mean different views of data don’t exist

Business analysis is not one-dimensional, and a single flavor is not good enough. Instead, we need to slice and dice it many times over. Sometimes data is available, and sometimes it’s not. In many cases, we may be asking entirely new questions that cannot be answered by available data points.

The single version of the truth isn’t dead; it’s just misunderstood.

These are all legitimate reasons why you may create, analyze, and distribute different views of data. But each analysis must start from the same authoritative source. If the scope of our question is predetermined where assumptions are stated, then different views do not result in a different answer. Whether the equation is “2+2”, “3+1”, or “4+0”, the answer must equal “4” no matter how you cut it because we start with the same variable (four pieces in total) in each case.

SVOT doesn’t mean that people cannot reach different conclusions from the same data

There is nothing healthier than different people looking at the same data—note the emphasis on the word “same”—and interpreting it differently and reaching different conclusions for debate. This approach can be especially beneficial, for example, during a planning exercise where you may be forced to consider alternative scenarios.

But all teams involved need to look at the same numbers as a starting point. Imagine the president of a company is reviewing one report while the regional leadership is reading another. What happens when both reports contradict each other in terms of the region’s performance? The level of frustration experienced in this situation can be both unproductive and demoralizing.

Let’s complicate matters more. How would this same circumstance impact a large, multinational corporation with fast-changing market conditions and fierce competition that is turning its business model upside-down by the forces of digital transformation? In essence, numbers should not be debated in a huddle.

SVOT doesn’t discourage different interpretations or perspective of data. Whether we use computing power or rely on our experience, critical thinking and seeking alternate perspectives are vital leadership tools.

Bottom line

The single version of the truth needs to be a leadership prescription, not something born out of a grassroots effort. It needs to be owned and promoted by the leadership from the top-down. Technology can only do so much, unless it is backed by a culture that understands and values it.

The process begins with identifying a system of reporting for the subject matter, which is reliable and maintainable for appropriate teams that follow best practices. All teams that report on this subject must use the system without tolerating any organizational outliers that may choose or prefer to report numbers outside of this system. If the numbers are wrong, the teams that maintain the reporting system need to be held accountable to ensure accuracy and timely delivery.

When applied effectively, SVOT is an essential ingredient for better-informed decision-making across all levels of an organization—small or large. Its application should be universal and span across all lines of business, roles, and business models.